Saba - Bersin by Deloitte - Performance Management in the 21st Century

Managing Performance in the 21st Century

Katherine Jones, Ph.D.

Vice President, HCM Technology

Bersin by Deloitte

Deloitte Consulting LLP

August 20, 2015

Copyright © 2015 Deloitte Development LLC. All rights reserved.1 Managing Performance in the 21st Century

Reinventing Performance Management

According to one organization

surveyed, 2 million hours a year

are spent on performance ratings

Source: “Reinventing Performance Management,” HBR.org / Marcus Buckingham and Ashley Goodall, April 2015,

https://hbr.org/2015/04/reinventing-performance-management.

58% of surveyed execs report

PM drives neither engagement

nor higher performance

Questioning Conventional

Wisdom:

• Cascading Objectives

• Once a year rankings and

reviews

• Backward-looking

assessments

• 360⁰ feedback tools

https://hbr.org/2015/04/reinventing-performance-management


• How Performance Management is Changing

• What Users Tell Us

• Today’s Technology Choices

Agenda

The purpose of Performance Management should be to support and improve an employee’s performance – not just assess it


The Evolution of Performance Management

Evolving From

Annual Event

Burdensome, Fixed

Centralized, Deferred

Appraisal Focused

Remediation

Evolving To

Ongoing

Business Process

Flexible, Agile, Simple

Local, Real-Time

Development-Focused

Continuous Improvement

Source: Bersin by Deloitte research, 2014.


Performance Management FrameworkAn at-a-glance view of how PM fits together

Multi-level Structure

Key Messages

Performance Appraisal

Ongoing Performance Activities

Performance Management Outcomes

Audience

Performance Management (PM) Strategy

Tech

no

log

y &

Infra

stru

ctu

reO

rgan

izati

on

& G

overn

an

ce

Goal-Setting & Revising

Managing & Coaching

Development Planning

Rewarding & Recognizing

Source: “The Performance Management Framework,” Stacia Sherman Garr / Bersin & Associates, 2011.

Copyright © 2014 Deloitte Development LLC. All rights reserved.6 Abolishing Performance Scores: A Practical Guide

Performance Appraisal

Ongoing Performance Activities

Performance Management Outcomes

Audience

Performance Management (PM) Strategy

Tech

no

log

y &

Infra

stru

ctu

reO

rga

niz

ati

on

& G

ove

rna

nc

e

Goal-Setting & Revising

Managing & Coaching

Development Planning

Rewarding & Recognizing

HOW WHAT

The Six Elements of a PM Strategy

Performance Management Strategy4. Clarify expected leader behaviors

5. Design for PM Sustainability

6. Plan for TM Integration

1. Determine purpose of PM

2. Identify PM philosophy

3. Align PM philosophy to strategy and culture

Source: “The Performance Management Framework,” Stacia Sherman Garr / Bersin & Associates, 2011.

How to Manage Performance in the 21st Century


2. Identify PM Philosophy

Behavior is Derived from Our Thinking

Behaviors

Systems:

Practices

Assumptions /

Theories

Source: “Getting Away from the Score: Creating Better Ongoing Performance Feedback,” Bersin & Associates, 2012.



Business Strategy

TM Strategy

PM Purpose & Philosophy

3. PM Alignment to Strategy & Culture

Organizational

Culture

Organizational

Culture

Source: “High-Impact Performance Management: Designing a Strategy for Effectiveness” Stacia

Sherman Garr / Bersin & Associates, 2011.



But Are We Very Good at it?

81% of respondents identified connecting performance goals to organizational

outcomes = Extremely important

52% of respondents thought they were successful

73% of respondents identified motivating staff to meet or exceed goals =

extremely important

42% of respondents thought they were successful in doing so…..

Source: Connecting Workforce Analytics to Better Business Results. Harvard Business School Publishing.

2013.


What Users Tell Us: 2015

67% of surveyed buyers of talent technology were planning to

purchase performance management software, either for the first time or as

a replacement for existing solutions.

Why?

• Increasing attention to its criticality

• Current solutions are aging

• Consolidation of multiple systems reigns

75% of those respondents replacing existing software = replacing a

standalone app with an integrated suite solution.

Investments in Human Capital Management Systems 2014: What Technology Users Have and What They Will Buy in the Year Ahead.

Katherine Jones. Bersin by Deloitte. April 2014.


What technology to you use to manage your employees’ performance today?

An application within our ERP program

A module from an integrated talent management suite

A standalone performance management application

Paper and pencil

None of the above

Question for the Audience

Henry– can we have a poll????

Copyright © 2015 Deloitte Development LLC. All rights reserved.12Goals: An Overlooked Weapon for Success

SVP

VP

Director

Director

VP

Director

Director

VP

Director

Director

Underlying Assumption of Traditional Approach

Yet, network tends to be much more aligned to

the reality of how work is done

Hierarchy… …Not Network



Why Coaching? Why Now?

Source: Guide to Performance Software 2015. Katherine Jones & Stacia Garr, Bersin by Deloitte. 2015.

Copyright © 2015 Deloitte Development LLC. All rights reserved.14 Performance Management: Top Trends and Leading Practices

Surveyed Organizations That Support Performance

Coaching Report Better Talent Outcomes

3.31

4.71

5.78

1.00

2.00

3.00

4.00

5.00

6.00

7.00

No or Weak Support Good Support Excellent Support

Tale

nt

Man

ag

em

en

t In

dex

Degree of Cultural Support for Coaching

Source: Bersin & Associates 2011 High Impact Performance Management research, n=193



Coaching Support is Often Limited

21%

38%

52%

55%

24%

21%

17%

10%

55%

41%

31%

34%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%100%

Provides automated coachingtools

Links to just-in-time coachinginformation

Provides workflows to trackcoaching and mentoring

conversations and activities

Enables managers to assign acoach or mentor to the employee

Yes Partial

No

Source: Guide to Performance Software 2015. Katherine Jones & Stacia Garr, Bersin by Deloitte. 2015.


Perceived Efficacy of Development Plans

Source: Guide to Performance Software 2015. Katherine Jones & Stacia Garr, Bersin by Deloitte. 2015


Employee Recognition: Surveyed Organizations

That Recognize Employees Have Lower Voluntary

Turnover

10.5%

8.7%

7.2%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

Poor (1-2) Fair (3-4) Excellent (5)

Vo

lun

tary

Tu

rno

ve

r R

ate

Effectiveness of Recognition Program at Improving Engagement

31% reduction in

voluntary turnover

Source: “High-Impact Performance Management: Making Recognition &

Rewards Matter,” Stacia Sherman Garr / Bersin & Associates, 2011.


Socially-Derived Feedback Used to Understand Performance

.. Source: Guide to Performance Software 2015. Katherine Jones & Stacia Garr, Bersin by Deloitte. 2015


Socially-Derived Feedback Used to Understand Performance

Source: Saba Software. 2014;


What performance-related technologies would you most like to add to your PM

processes today?

Analytic dashboards

Socially-derived feedback

Coaching support for managers

Mobile support for feedback to employees

Better alignment for with development planning

Improved support for cross-team performance

Question for the Audience


Performance management apps are the most noted software

application area targeted for investment in 2014-15.

Most buyers seek performance management software as part

of an integrated talent management suite

Ongoing coaching and feedback is becoming a primary

element of performance development in many high-impact

organizations; only a subset of software applications are

supporting coaching management and tracking today.

Applications supporting performance management should be

agile, simple, and responsive to real-time needs, focusing

more on development than appraisal, employee strengths

instead of remediation, and on data-driven outcomes instead

of assumptions.

Conclusion

Source: Investments in Human Capital Management Systems 2014. Katherine Jones. Bersin by Deloitte. April

2014.

Q&A

Dr. Katherine JonesLinkedIn: Dr. Katherine JonesTwitter: @katherine_jonesEmail: [email protected]

For More Information:

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This publication contains general information only and Deloitte is not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this publication.

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Saba - Bersin by Deloitte - Performance Management in the 21st Century

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